Investing in i3 Verticals (NASDAQ:IIIV) five years ago would have given you a 15% gain

If you buy and hold stocks for many years, you expect to make a profit. But more than that, you probably want to see it rise more than the market average. Unfortunately for shareholders, while the i3 Verticals, Inc. (NASDAQ: IIIV ) stock price is up 15% over the past five years, which is less than the market’s performance. Over the past twelve months, the share price has risen a very respectable 15%.

Now it’s also worth taking a look at the company’s fundamentals, because this will help us determine whether long-term shareholder returns have matched the performance of the underlying business.

Check out our latest analysis for i3 Verticals

i3 Verticals was not profitable in the last twelve months, it is unlikely that we will see a strong correlation between its share price and its earnings per share (EPS). Income is definitely our best option. When a company isn’t making a profit, we generally expect to see good revenue growth. This is because rapid revenue growth can easily be extrapolated to forecast profits, often of considerable size.

Over the last half of the decade, i3 Verticals can boast revenue growth at a rate of 6.2% annually. That’s a pretty respectable growth rate. 3% annual gain over five years is better than nothing, but it doesn’t reach the market. It could even be argued that the share price was too bullish previously.

Below you can see how earnings and revenue have changed over time (find out the exact values ​​by clicking on the image).

It’s probably worth noting that the CEO is paid less than average at companies of similar size. But while CEO pay is always worth checking, the really important question is whether the company can grow earnings in the future. So it makes a lot of sense to check out what analysts think i3 Verticals will earn in the future (free earnings forecasts).

A Different Perspective

i3 Verticals shareholders earned a total return of 15% for the year. Unfortunately, this falls short of market profitability. The bright side is that the gain was actually better than the average annual return of 3% per year over five years. Returns may improve along with business fundamentals. You can better understand the growth of i3 Verticals by viewing this more detailed historical chart of earnings, revenue and cash flow.

We’ll like the i3 Verticals more if we see some big insider purchases. While we wait, check this out free list of undervalued stocks (mostly small-cap) with recent and significant buying.

Note that the market returns quoted in this article reflect the market-weighted average returns for stocks currently trading on US exchanges.

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This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell shares, and does not take into account your goals or financial situation. Our goal is to provide you with long-term analysis based on fundamental data. Please note that our analysis may not take into account the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stock mentioned.